Articles Posted inDamaged Cars

Triple damages are mandatory. That means if there is a verdict for any ascertainable loss the amount is tripled by the court without discretion and automatically. You must prove a loss or what is commonly known as an ascertainable loss. This amount is tripled.

You can collect from the lender for defective cars under the HOLDER RULE.

Since the contract that the lender is holding permits the buyer to sue the lender, the lender can be sued up to the amount paid on the contract. The lender is in the position to allocate the risk for such losses and defray the risk.

The law in New Jersey is no longer “buyer beware” and New Jersey has taken the more ethical approach to the sale of goods. The dealer is charged with knowing the goods that they sell, such as cars. If they make a promise that the car has not been in an accident they must make good on the affirmative representation. If their statements are false then the dealer can be sued for a violation of the Consumer Fraud Act, NJSA 56:8-2.

Reasonably priced technology assures that dealers are aware of any damage to a car that they sell. An Elcometer. This device measures the thickness of the paint on the car. There are manufacturer standards for paint thickness. There are standards for consistency on a car. This device can absolutely warn a dealer if a car was repainted. This raises a red flag that the dealer must take a closer look at the car. They will then see other evidence that the car was wrecked, such as frame repair, over spray or bondo on the car. This is all obvious to anyone with any automotive experience, especially a dealer selling cars for a living. There are also frame machines that can measure even slight imbalances in the frame. These are a reasonably-priced option for the dealers selling cars to the public. Don’t you think they should take the steps necessary to assure the cars that they both buy and sell are safe for the public’s use? Does it seem to be asking very much? Not really.

Dealers are required to inspect the cars before they sell them to the public. Industry standards mandate this result. They are in the best position and have the expertise to make these safety inspections. This aside, common sense mandates this result. Why would a dealer want to open himself to liability for selling a dangerous car when they had the chance to assure the car was safe? At a minimum they do not want a pissed-off customer with many mechanical complaints. Bad for business. Might cost the dealer money in repairs. Might get sued.

Also, the dealer has a process for acquiring cars from auctions, on trades and by wholesale to assure that the cars are not damaged. Most of the auctions have special designations for damaged cars. Green light means no problem while cars sold under the yellow and red light have problems, mechanical or otherwise. Manheim Auto Auction is the main source of cars for these dealerships and they have a detailed system of disclosure. Manheim actually offers an inspection service for those buying and selling cars at the auction to assure an open and honest marketplace.Continue Reading

Millions of new and used cars are sold every year in this country. It is well-known within the industry that many of the used cars are damaged, ranging form minor body damage to serious frame damage.

Many dealers sell these cars and make a handsome profit. The first issue is: what is the dealer’s liability if they sell these cars?

There are many areas of law that address this liability: Consumer Fraud, Fraud, Breach of Warranty, Lemon Law (New and Used)

FRAUD
The basic premise of fraud is that if the dealer knows about the damage and they think that disclosing the information would make a difference in the consumer’s purchasing decision they must make the disclosure, whether or not they are asked by the purchaser. There is also liability for reckless disregard, meaning if they intentionally disregard the risk and stick their heads in the sand to avoid learning that the car was damaged, there is liability.
CONSUMER FRAUD
The analysis is more complex but, for the sake of brevity, if the dealer knew or should have known and failed to disclose this information there is liability under the Consumer Fraud Act. Intent must be proven under this situation.
The dealer can also be sued if the they misrepresented that the car was not in an accident when it actually was, even if they did not know. This is called an affirmative misrepresentation of fact. The dealer as a seller of merchandise is obligated to assure that their representations pertaining to their goods must be accurate.Continue Reading